Overnight Finance

On The Money: Powell urges Congress to continue boosted jobless benefits ‘in some form’ | Trade chief denies Bolton claim that Trump asked Xi for election help | Trump administration releases new PPP loan forgiveness forms

Greg Nash

Happy Wednesday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL—Powell urges Congress to continue boosted jobless benefits ‘in some form’ Federal Reserve Chairman Jerome Powell said Wednesday that Congress should extend enhanced unemployment insurance “in some form” after a $600 increase to current benefit levels expires on July 31.

  • During a House hearing Wednesday, the Fed chief made his most explicit call yet for lawmakers to continue supplementing unemployment benefits as Congress debates whether to extend or modify the $600-boost included in the Coronavirus Aid, Relief and Economic Security (CARES) Act.
  • Powell urged members of the House Financial Services Committee on Wednesday to prevent a steep drop in income for millions of unemployed Americans who may be unable or unwilling to return to work during the coronavirus pandemic. 
  • The Fed chairman did not specify how Congress should do so, but warned lawmakers not to let unemployment benefits revert back to their pre-pandemic levels when the support expires at the end of July.

“It probably is going to be important that it be continued in some form. I wouldn’t say what form, but you wouldn’t want to go all the way to 0 on that,” Powell said.

The background: President Trump, White House officials and GOP lawmakers who have stressed the importance of quickly returning to normal life have touted the strong data as vindication for their approach to fighting the medical and economic crises. 

  • Many Republicans see the increased unemployment benefits as a disincentive for workers to return to their jobs and oppose extending them. The CARES Act boosted unemployment benefits to a level equal to or greater than the average weekly wage in 38 states, according to an analysis from former Treasury Department economist Ernie Tedeschi.
  • But Democrats largely support extending the increase to help prevent high-risk workers from choosing between their health and finances while supporting those who worked in industries severely restricted by the pandemic.

Powell acknowledged the concerns of each party Wednesday, noting that while many Americans would make more money on unemployment, much of the difference reflects the low wages they earned before the pandemic forced them home.

“It would be wise to look at ways to continue to support both people who are out of work, and also smaller businesses that may not have vast resources for a continued period of time,” he added.

“Not forever, but for a period of time so that we can get through this critical phase.”

Keep reading: Powell presses Congress for more coronavirus support

LEADING THE DAY

Trade chief denies Bolton claim that Trump asked Xi for election help: U.S. Trade Representative Robert Lighthizer on Wednesday denied a claim by former national security advisor John Bolton that President Trump asked Chinese President Xi Jinping for help winning the 2020 election.

“Absolutely untrue, never happened. I was there, I have no recollection of that ever happening. I don’t believe it’s true, I don’t believe it ever happened,” Lighthizer said at a Senate Finance Committee Hearing.

  • Less than an hour earlier, The Washington Post ran an excerpt from Bolton’s upcoming book, in which the former Trump administration official claims that Trump made the request for electoral help from Xi during a one-on-one meeting at the Group of 20 summit in Japan in June 2019.
  • Trump, Bolton wrote, turned the conversation to “China’s economic capability to affect the ongoing campaigns, pleading with Xi to ensure he’d win.”
  • “He stressed the importance of farmers, and increased Chinese purchases of soybeans and wheat in the electoral outcome. I would print Trump’s exact words but the government’s prepublication review process has decided otherwise,” the Washington Post excerpt read.

Lighthizer said he was at the meeting in question and would have recollected such an exchange, and disputed Bolton’s account. The Hill’s Niv Elis has more on the fallout here.

Read more: China on track to fulfill ‘phase one’ trade deal purchases: Lighthizer

 

Judge orders Mnuchin to give Native American tribes full stimulus funding: A federal judge is once again ordering Treasury Secretary Steven Mnuchin to release the full amount of stimulus funding Congress set aside for Native American tribes.

A Tuesday decision from U.S. District Judge Amit Mehta was particularly critical of Mnuchin’s decision to hold back $679 million in funding set aside for tribes while waiting on a decision in another case that will determine whether tribal businesses are eligible for the funding.

“The Secretary has now taken more than twice as much time as Congress directed to distribute all CARES Act funds,” Mehta wrote, referring to the $2.2 trillion March legislation that sets aside $8 billion for tribal governments.

“The 80 days they have waited, when Congress intended receipt of emergency funds in less than half that time, is long enough.”

The Hill’s Rebecca Beitsch explains here.

GOOD TO KNOW

  • The Trump administration on Wednesday released a new, shorter version of the loan-forgiveness application form for certain borrowers under the Paycheck Protection Program, after lawmakers urged the administration to streamline the loan-forgiveness process.
  • Democrats on the Senate Finance Committee are pressing the IRS about a watchdog’s finding that the agency did not address hundreds of thousands of high-income people who failed to file tax returns.
  • President Trump’s election-year push for a $1 trillion infrastructure spending bill to boost the struggling economy faces strong opposition from Senate Republicans.

ODDS AND ENDS

  • The Trump administration on Wednesday imposed sanctions on Syria’s President Bashar Assad, his wife Asma Assad and dozens of individuals for mass atrocities against civilians that have taken place over the course of the nine-year civil war in that country.
Tags Donald Trump John Bolton Robert Lighthizer Steven Mnuchin
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